Morning Snapshot: Gold retreats, but remains within yesterday’s range

USAGOLD/Peter Grant/09-15-17

Gold is trading lower, but within the confines of yesterday’s range. The yellow metal shrugged off North Korea’s latest missile launch, perhaps as such expectations had been previously priced in by the market.

South Korea test-fired missiles of its own in response to the latest provocation. The DPKR missile was the second to overfly Japan in less than a month. This, along with the recent bellicose threats to “sink” Japan, is driving conversations about increasing Japan’s military capabilities.

If Japan and South Korea were to increase military spending, China would likely respond in kind. That may result in an Asian arms race. And when a country has a lot of high tech weaponry, there’s always some faction that wants to use them . . .

Disappointing U.S. economic data should limit the downside for gold as well. Both August retail sales and industrial production missed expectations by significant margins. The Empire State Index for September, but not as much as was expected. The initial University of Michigan consumer sentiment reading for September comes out later this morning.

The dollar index has now retraced more than 61.8% of its recent correction, returning focus to the downside. The weaker dollar should underpin gold as well, suggesting the dip in gold is a buying opportunity.

Share
This entry was posted in all posts, Gold News, Gold Price, Gold Views, Snapshot. Bookmark the permalink.

Comments are closed.